Brazil may retake Rio airport amid funding problems, official says

RIO DE JANEIRO, Sept 14 (Reuters) - The Brazilian government
is considering retaking control of Rio de Janeiro's
international airport from a consortium of private investors who
are struggling with a dearth of long-term financing, a senior
official said on Wednesday.

Among options, the government is analyzing voiding the
license that the so-called Galeão Aeroporto do Futuro consortium
won at an auction in November 2013, and launch a new process,
said Tarcísio de Freitas, undersecretary at an agency overseeing
potential state asset sales. A presidential decree could pave
the way for such action, Freitas added at an event in Rio de
Janeiro.

Government officials have already discussed the content of
the draft decree, which could be ready within a month, he said,
without elaborating. The consortium, comprised of Odebrecht
Transport SA and a unit of Singapore Changi Airport, pledged to
pay 19 billion reais ($5.7 billion) to win the right to operate
the Galeão airport for 25 years.

Efforts to reach representatives of both companies after
business hours were unsuccessful.

The Galeão license was sold during the first term of former
President Dilma Rousseff. The official said the consortium had
failed to secure long-term financing since the parent company of
Odebrecht Transport fell under the radar of investigators in a
sweeping corruption probe in Brazil.

"The airport licenses obviously suffered with macroeconomic
problems in the country, but there were irresponsible bids that
took place," Freitas said.

His remarks underscored a swift change of tack in the
government since Rousseff was removed in May for breaching
budget laws.

President Michel Temer, who was formally sworn in on Aug. 31
following Rousseff's impeachment, has vowed to encourage new
investment in infrastructure and enforce contractual terms for
existing licenses, which the prior government avoided.

Most of the licensees that won operating rights during the
Rousseff administration have cited a harsh recession and
declining travel flows as reasons to stretch out installments
for the concessions.